As it is now 4.15 p.m., in accordance with an order of the Dáil of today, I now come to deal with Private Notice Questions to the Minister for Public Enterprise, on the strike at Aer Lingus. I will call on the Deputies who tabled questions to the Minister in the order in which they submitted their questions to my office.
Private Notice Questions. - Strike Action at Aer Lingus.
asked the Minister for Public Enterprise the action, if any, she is taking to resolve the current clerical staff dispute in Aer Lingus; if she is aware of the detrimental impact which this is having on our tourism sector; and if she will make a statement on the matter.
(Mayo) asked the Minister for Public Enterprise the steps which are being taken to avert the strike by Aer Lingus clerical staff on 6 April, 2001, which will leave 20,000 passengers stranded for the second weekend in succession; and if she will make a statement on the matter.
(Dublin West) asked the Minister for Public Enterprise what steps are being taken to resolve the industrial dispute in Aer Lingus at Dublin Airport.
asked the Minister for Public Enterprise the reasons talks to resolve the dispute at Aer Lingus have failed; and the steps she has taken to avert a strike which could ground all Aer Lingus flights from midnight on 5 April 2001; the steps she is taking to assist passengers; and if she will make a statement on the matter.
asked the Minister for Public Enterprise the steps the Government intends to take to seek a resolution to the dispute at Aer Lingus, having regard to the serious disruption to travellers and the consequences for the tourism industry already facing serious problems as a result of the foot and mouth disease outbreak; and if she will make a statement on the matter.
I sincerely regret that once again industrial action will disrupt Aer Lingus services and cause inconvenience for Aer Lingus customers tomorrow. I am also very much aware of the effects of those disputes on the tourism and business sectors of the economy, particularly at the present time, when many businesses have been seriously disrupted by foot and mouth disease restrictions.
The proposed one-day stoppage tomorrow by the clerical and operative grades represented by SIPTU, follows on from similar action last Friday which led to the cancellation of almost all Aer Lingus services. On 28 March 2001, the implementation body of the Programme for Prosperity and Fairness, reviewed this latest dispute. It expressed serious concern at the prospect of industrial action, having regard to the commitment to industrial peace and stability in the PPF, and the likely consequences of the action. The implementation body requested the Labour Court to assist the parties in resolving the issues in dispute. The Labour Court agreed to the request from the implementation body and met Aer Lingus and SIPTU on Thursday, 29 March 2001. I understand the purpose of that meeting was to establish the main issues in the dispute. However, progress was not made. The Labour Court concluded that as SIPTU was not prepared to call off its strike planned for Friday 30 March, it could do nothing further at that stage. Talks under the auspices of the Labour Relations Commission took place between the parties last Monday, 2 April, but despite five hours of talks, no progress was made.
The national implementation body of the PPF met senior representatives of SIPTU on Tuesday, 3 April. Arising from this meeting a formal meeting took place between SIPTU and the group chief executive of Aer Lingus yesterday, 4 April, at which, I understand, no progress was made and SIPTU announced that it was going ahead with a 24 hour stoppage from midnight tonight. In the circumstances, Aer Lingus had no option, but to suspend the bulk of its operations and advise the public of its position.
Aer Lingus management has negotiated over the past three years with all sections of its workforce, either through direct talks or using the State industrial relations machinery, in relation to claims on pay, pensions and working conditions. Significant progress was made and a number of settlements have been agreed and put in place. In particular, last November and December, following separate ballots, the operative and clerical grades, which are now in dispute, accepted significant improvements in pay and conditions. These settlements followed a lengthy process of direct negotiations and involved assistance from the Labour Relations Commission and the Labour Court.
My understanding is that the current disputes arise from a parity pay claim lodged by SIPTU on the basis of the recent settlement terms for cabin crew staff which it considers more generous than those negotiated and already accepted by it late last year. Aer Lingus has rejected the claim. The Aer Lingus position is that no group of employees has received significantly higher payments than others in the airline. Each group made its own case, which was dealt with on its merits. The trade unions sought this approach. The company states that it has adopted a consistent approach with all groups and that pay restructuring in all cases stemmed from flexibility and productivity measures relevant to the particular group in the airline.
I am very disappointed with what has happened to the talks and the latest planned industrial action. I share the views of the national implementation body that this strike action is not in keeping with the commitment to industrial peace in the PPF. I expect all parties to the PPF to live up to their commitments. This means employers abiding by pay increase proposals and trade unions complying with industrial peace clauses. Significant progress has been made in addressing claims by staff in Aer Lingus. Any remaining concerns could and should be addressed in a manner which does not have serious consequences for the airline's customers, its finances and credibility.
No commercial company – Aer Lingus is no exception – could sustain repeated catch-up claims. The increasing competitive pressure in all its markets, combined with the impact of the pay settlements on its cost base, the general weakening of the aviation market – particularly to and from the United States – and the significant impact of the foot and mouth disease restrictions, have resulted in Aer Lingus facing a very serious financial situation for the current year. The continuing impact of industrial action on its operations further compounds those difficulties.
Aer Lingus was just emerging in 1997 from the last major financial crisis and had started to rebuild its position and focus on profitable growth. I appreciate that it was necessary for all involved in the airline to make sacrifices in order that it could be returned to viability. The low pay issue, which can be traced back to that period, has been addressed by the company in the past year with exhaustive use of the State's industrial relations machinery.
I am concerned that if sense and restraint are not applied, the airline could rapidly find itself in another financial crisis. As we have seen with the fall-out from the foot and mouth crisis, the airline sector is very vulnerable to external shocks over which we, in Ireland, have no control. I call on all parties in Aer Lingus, management and unions, to rapidly settle all outstanding matters.
I apologise to the travelling public who will be upset and concerned. It will have to make alternative travel arrangements. This is another bitter blow for it on top of last Friday's strike action.
The Minister said that she was disappointed at and concerned about the ongoing industrial unrest in Aer Lingus. Does she agree that the ongoing dispute is damaging the credibility of Aer Lingus, causing huge losses – up to £10 million if the three day strike goes ahead – and seriously damaging to the potential of the tourism sector to get over the crisis brought about by foot and mouth disease? Has she met either management or the trade unions? Has the Cabinet or a Cabinet sub-committee discussed the dispute in Aer Lingus? What mechanisms are available within her Department to deal with such disputes? What action has she taken since the first strike last Friday and what action does she intend to take? Has she discussed the matter with the Minister for Tourism, Sport and Recreation who has a £3 million budget which he cannot spend until the issue is resolved?
I discussed the matter with the Minister for Tourism, Sport and Recreation, Deputy McDaid, a short time ago. I also spoke to the Taoiseach about the dispute. Within my Department there is a subcommittee called the national implementation body of the PFF, structured at the end of last year, which deals with the trade unions and issues arising from industrial unrest. The labour relations section of my Department also works in this area. I have spoken on two occasions, this week and last week, to the chairman of Aer Lingus who has asked to meet me on Monday evening or Tuesday morning of next week, whichever is most suitable. The Labour Relations Commission, the Labour Court and direct negotiations between Aer Lingus and the trade unions have all been used to the fullest extent.
I do not intend to enter into direct negotiations. It is not my job to intervene in that way when there are arms of Government suited to that task – the Labour Relations Commission and the Labour Court, whose job it is to deal with disputes such as this, a role which they fulfil very well. It is not and never was the remit of an individual Minister to directly negotiate on pay disputes.
I realise fully that the cost and number of disputes are seriously undermining the credibility of Aer Lingus and that this is reflected in the alarming decrease in the level of advance bookings to which the foot and mouth outbreak and the downturn in the US economy have also contributed.
(Mayo): Does the Minister accept that she is presiding over the self-destruction of the national airline?
No.
(Mayo): The national implementation body, the Labour Court and the Labour Relations Commission have all been used and we have been on the merry-go-round for some time. Is it not the case that when all the existing labour relations machinery has failed, the Minister, as the custodian of the company, has an obligation to intervene and call both sides to her Department to find a solution? The situation cannot continue. In recent months cabin crew, clerical staff, caterers and baggage handlers have all been on strike. Clerical staff are again on strike and we are entering the same merry-go-round. Does this arise from the fact that SIPTU made it perfectly clear to management that it would seek a catch-up adjustment if cabin crew received a larger wage increase and improved conditions? Is it not the case that the company is dealing with each sector on a one by one basis with the result that when one is granted a rise, another wants to catch up? There is a domino effect.
Rather than getting an interlocking agreement we have a series of one by one negotiations which are not working. This is the cause of the chaos experienced last Friday and which is expected tomorrow, next Thursday and possibly on other days in the future.
I fully accept that the company cannot go on in the present circumstances. I share that point of view. The one by one basis for negotiating is at the request of the trade unions involved. The various categories such as baggage handlers, catering staff, cleaning staff and pilots each requested that they be dealt with on a one by one basis and not as a group of unions acting together. Generally the wishes of individual trade unions are accepted in situations such as this.
There is no position for me to intervene directly in a wage negotiation between the company and workers. Aer Lingus is a commercial semi-State company. Its remit is established by law. Unions and management have their arrangements for dealing with matters such as this. It would be a recipe for chaos if I were to intervene in a dispute about wages and conditions applying to individual groups in any company. I accept that the present chaos is severely hindering the company and that it would be very difficult for the company to continue to maintain a viable position in the present circumstances.
(Dublin West): During the disputes which erupted in recent months the country was stunned to learn of the low level of wages in Aer Lingus. Does the Minister agree that the issues at stake in this dispute are not substantial in terms of what it would take for Aer Lingus management to resolve it? Why has no meaningful Government or Labour Court intervention been made to resolve the complaints of Aer Lingus staff? The Minister has agreed that the issues are not substantial.
Is a secret agenda operating to create the conditions to provoke a strike by giving the workers no other option? Is this being done so that, following the failure to have Aer Lingus as a whole privatised, individual sections such as catering, cargo handling, aircraft cleaning and loading can be hived off and privatised separately? Is this the real agenda and is the Minister party to it?
My suspicions are underlined by the extraordinary agreement between Aer Lingus and Ryanair to transfer as many of tomorrow's Aer Lingus passengers as possible to Ryanair with the full Aer Lingus fare, which is greater than the Ryanair fare, being paid to Ryanair. Does this decision not mean that the company is intent on absorbing huge costs in order to resist insubstantial claims by workers?
The arrangement with Ryanair is intended to facilitate customers. It is not intended to facilitate Ryanair. I believe it is a commendable effort by Aer Lingus to ensure that as many passengers as possible will be able to travel. I am sure similar arrangements are being made with other airlines. There is nothing sinister in the arrangements.
(Dublin West): This is the first time such an arrangement has been made.
No, it is not the first time. I know nothing of any plan to hive off sections of Aer Lingus's business for privatisation. I have not heard this suggestion before. Such an agenda plays no part in the current dispute.
The Minister has said the company cannot go on. What does she mean by this and what does she envisage happening to it? Has she any plan to prevent the company going from crisis to crisis as it appears to have been doing in the past number of months? Why is this happening? Has she or her Department carried out any evaluation to see if anything can be done to stop this cycle of destruction?
What is the financial cost to Aer Lingus of the strikes which have occurred to date and the strike which is about to take place? Is there a knock on cost to the Exchequer?
Deputy Higgins said the company cannot go on in the present fashion and I agreed with him. Aer Lingus is mandated to operate as a commercial semi-State company maintaining itself in profit. The series of industrial relations crises in the company along with the foot and mouth disease crisis and the downturn in the US economy will make it very difficult for the company to fulfil its remit as a commercial semi-State company. That is what I meant.
What happens then?
We are not at that point. I echo what Deputy Stanton's colleague, Deputy Higgins, said and I am merely explaining the background to my statement and, I expect, his. The company is lurching from crisis to crisis. I have been asked the financial cost of each day's strike. The cost of each day's action is between £2 million and £3 million. Apart from the inconvenience felt tomorrow, the ongoing cost will be a loss of confidence in the company. This could contribute to a downturn in bookings which has already begun to hit the company.
Does the Minister accept that her apologies and regrets are not enough? During her period of control and legal ownership of semi-State companies there has been a rash of industrial relations disasters. Passengers have been inconvenienced by disputes in CIE, the ESB will turn off power stations in a fortnight's time and this is the fourth occasion since last October that the Aer Lingus fleet has been grounded. It is the Minister's job to ensure these companies work effectively. The boards of these companies were appointed by her and if they are not doing their job she should sack them. Is the Minister considering any action to reverse the history of disasters in these companies going back over two or three years? It is on her watch that this is occurring. To correct something the Minister may have said in her initial reply – she said that all the claims granted were about equal. The cabin crew got 17% and those we are dealing with here got 5.5%. Will the Minister agree this group, which was the first to settle, accepted 5.5% on the basis that in the event of any enhanced agreement for other parties they would get equity? They are not looking for equal pay but rather for equity.
I am aware that their claim is based on the tenet of equity. The clerical staff, with whom Aer Lingus management is in dispute, voted to accept in November 2000. The previous pay scale was £9,000 to £19,000. The new pay scale is £12,000 to £21,000. Those were the amounts they accepted in November. All clerical staff were to receive a lump sum of £500 immediately, a guaranteed minimum increase of £2,000 per annum for all, annual increments would be £529, introduction of long service increments and there were various other conditions attendant upon that claim. The previous pay scale was on 28 points whereas the new scale is on 18 points. There was an average increase of £2,000 per operative from that agreement which was voted upon and accepted in November. The first dispute in this new round was in March. The jumping of a claim which has been settled just four months—
There was a condition that there would be equity for the clerical staff.
They have made their claim on the premise of parity which is what Aer Lingus is disputing. This matter has been to the Labour Court, the national implementation body of the Programme for Prosperity and Fairness and the Labour Relations Commission. For a considerable period yesterday the chief executive of Aer Lingus met with, as I understand it, union representatives from Dublin, Cork and Galway but the outcome of all those meetings was stalemate.
In light of the fact this dispute will have a detrimental effect on Aer Lingus and on the economy due to its impact on tourism, why has the Cabinet or a Cabinet sub-commitee not discussed this issue?
I have discussed the matter with the Taoiseach and the Minister for Tourism, Sport and Recreation, Deputy McDaid.
The Cabinet has not discussed it.
It is not for me to say here whether that has been discussed. I have discussed the matter with the Taoiseach and I have discussed the matter with the Minister for Tourism, Sport and Recreation, Deputy McDaid. The national implementation body of the Programme for Prosperity and Fairness, which is under the aegis of the Taoiseach, has discussed the matter. The outcome of all those discussions, using the labour relations machinery – the Labour Court and the Labour Relations Commission – has been a stalemate. Despite the arrangements made with another airline and despite rescheduling which has been done to a great extent I apologise to the public for the discomfort caused.
Written answers follow Adjournment Debate.